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4 annoying things about the Obamacare rollout and how to deal

Posted By Claes Bell On 10/29/2013 @ 8:32 am In Health Care | 6 Comments

Just days after finally getting a stopgap budget passed and turning the lights back on at the federal government, Washington politicians woke up to an ugly reality: There have been some rather large and nasty bugs in the rollout of the Affordable Care Act, popularly known as Obamacare.

Here are some of the biggest Obamacare issues stressing out consumers, and how you can deal with them.

Healthcare.gov is terrible

The problem: Users trying to sign up on the health insurance exchange website where they’re supposed to purchase coverage have had nothing but trouble since Day 1.

“The federal exchange has had a great deal of difficulty,” says Henry Aaron, a senior fellow at the Brookings Institution. “It’s very important that they get the federal exchange right because it’s covering most states.”

What you can do: First off, if you’re in a state with its own exchange, such as California or Colorado, you can probably sign up easily today if you want, Aaron says.

“Many of the state exchanges are doing reasonably well,” Aaron says, citing a chart published [3] in the New York Times recently showing many states have exceeded their Obamacare enrollment goals for the month.

If you’re going to have purchase health insurance through the federal exchanges because your state doesn’t have its own exchange, you may as well just wait, Aaron says.

By the end of November, a lot of the bugs with the federal website should be worked out, and since the insurance you’ll be signing up for won’t start until Jan. 1, 2014, there’s no reason to put money down early, Aaron says.

If you don’t want to wait, you can always pay a visit to a private insurance agent, many of whom are already well versed in the ways of Obamacare, he says.

You got a scary letter from your health insurer telling you you’re being dropped

The problem: Many barebones insurance plans purchased by people who couldn’t afford better coverage, expected to stay healthy or had enough money on hand to self-insure don’t meet the minimum requirements for health insurance under Obamacare, Aaron says.

Those plans often had hard annual and lifetime limits on the amount the insurance company would pay out, and excluded many kinds of care; both of which are prohibited under Obamacare.

“You’re not going to be allowed to get away from the mandate that you have insurance coverage if you have plans that leave important benefits out,” he says.

What you can do: Don’t freak out. If you take a close look at most of the letters insurance companies sent out, they probably specify that you won’t be dropped until Jan. 1, the day when policies purchased under Obamacare take effect, so you’ve got some breathing room.

Aaron’s advice for those who want to line up replacement coverage is the same as for everyone else who will need to enroll in Obamacare: wait another month or so until the bugs have been dealt with and then sign up.

New coverage under Obamacare is going to be WAY more expensive than your old policy

The problem: The minimum allowable coverage is often way more expensive than the those barebones policies many people have been carrying.

Seeing what their new monthly premium will be has been causing sticker shock for some, and that’s a thorny issue because although those old policies didn’t actually cover much, they did represent an option for people who couldn’t or didn’t want to purchase more coverage.

For instance, CBS ran an interview with a 55-year-old woman dismayed that her insurance premiums would be rising from $54 to $591 a month. She probably wasn’t getting much coverage for $54 a month, but it was her plan and if Obamacare hadn’t come along, she would have been able to keep it.

What you can do: Obamacare does allow for plans with fairly high deductibles, especially for those under 30, which may be cheaper than a standard plan you’ve been quoted, Aaron says.

Many Americans will also receive some sort of help with the premiums through a tax credit. Those making less than 138 percent of the poverty level, $15,856 for singles and $32,499 for a family of four, will receive free coverage thanks to a Medicaid expansion, although some states have decided not to go along with that expansion.

You can get information on how much assistance you qualify for by signing up on the working state exchanges, or by contacting a local health navigator [4], Aaron says.

The Kaiser Family Foundation also has a nifty calculator [5] that might help.

The mandate to buy health insurance is scary, annoying or both

The problem: For some people, being forced to buy health insurance is annoying, and having to get it done by a cutoff date or pay a penalty is stressing them out.

What you can do: Keep in mind it’s very possible the government will be forced to push back the deadline for signing up if problems with the exchanges persist; they’ve already done so once. And even if they don’t, you have more than 150 days to get everything straightened out before the “open enrollment” window closes March 31, 2014.

Also, there’s always the option to just throw your hands up, say “screw it” and just pay the penalty for not having health insurance rather than dealing with all this stuff.

The penalty for not being insured under Obamacare in 2014 will be $95 per adult and $47.50 per child up to a total of $285, or 1 percent of your annual household income, whichever is greater. That’s a substantial amount of money, but probably not as much as you’d have to pay to be insured and probably not life-changing for most people. Unfortunately, in 2015, the penalty increases to $325 per person or 2 percent of income, eventually rising to $695 per person, or 2.5 percent of income in 2016.

Still, I think for most people just paying the penalty would be a mistake. Regardless of how you feel about the law itself and how it fits into your beliefs about the role of government, now that it’s passed, it’s in the best interest of consumers to get the most out of it. After all, we’re paying for it, and if someone who otherwise couldn’t get health insurance can now get covered, that’s a huge financial win for them.

This year will see nearly 2 million people declare bankruptcy because of medical bills, more than for unpaid mortgages or credit cards. Unless you’re independently wealth, a serious diagnosis can mean pretty much instant bankruptcy for the uninsured. Just the first year of breast cancer treatment rings in at $23,078 (or $19,710 for prostate cancer), and those numbers come from Medicare, which usually pays much less than a private citizen would for treatment.

While having to pay for health insurance is never fun, it beats the heck out of having your entire life savings and lots of your future earnings wiped out by an unforeseen illness.

What do you think? Are there any annoying things about Obamacare you’re worried about that I didn’t address?

(Photo: Mike Licht, NotionsCapital.com)

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[3] a chart published: http://www.nytimes.com/interactive/2013/10/04/us/opening-week-of-health-exchanges.html

[4] a local health navigator: https://localhelp.healthcare.gov/

[5] a nifty calculator: http://kff.org/interactive/subsidy-calculator/

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